International Process and Performance Institute

Having two teenage boys who played a lot of video games, I came to understand an interesting and recent addition to the English language.  The word “spawn” has for some time defined the reproduction of egg bearing aquatic animals, and more recently, a computing term where a system process executes a child process.  In video games the characters, including the players, are “spawned” into the game and when they are killed off (in the game of course), the characters can come back to life or “respawn.”  I found this concept of “respawning” very interesting.  I would give my sons a hard time about game realism being such a highly sought after feature in video gaming culture, and yet where was the realism in respawning in the middle of the game?  I would occasionally challenge them to show one real-life example of respawning in the world.  Of course, they would ignore my unsolicited cynicism by continuing to play their game.

My cynicism about the concept of respawning continued for some time, until I actually discovered it in the real world of process.  What I discovered was that certain Moments of Truth had a natural tendency of respawning when they failed.  Moments of Truth are the places in our processes where the customer is involved or “touched.”  Imagine you are calling the support line for your Internet provider and you get a busy signal.  You say to yourself, “that’s odd”, then pick up the phone and dial again.  Is it one Moment of Truth or two?  Imagine you are filling in a form on a website.  After completing all the necessary fields and selecting “Continue”, the display blinks and takes you back to the form to complete again.  You’re pretty certain you filled in the form correctly, but you fill it in again and select “Continue”, only for it to repeat the behavior and blank the form again.  You tell yourself, “third time is a charm” and proceed to fill it out one more time; sure enough, that time it works.  Is it one Moment of Truth or three? 

These examples and many others point to the fact that when Moments of Truth fail, they sometimes respawn until either successful or the customer gives up.  These are not different Moments of Truth but the same, and can keep occurring iteratively until successful.  I hope this can help in your analysis efforts in more accurately determining the process Moments of Truth (MOTs).

I recently received an email query from a member in regard to Process Activity Lists (PALs) I would like to share because it was an outstanding question and one I think a lot of members might have.   The query was:

Hello,

I am puzzled how PALs (Process Activity Lists) can be used to fully represent Processes. I am used to working with BPMN and divergent paths based on decisions (e.g. if product is IN STOCK follow one path, otherwise follow another). I am not clear how PALs represent this. In the CEM Optimize method, sequential activities, allotted to an actor, are joined by a line ... if a decision point were reached, then the line would surely split. For example, suppose that the case study referred to provision of internet services and a diagnostic revealed a line problem versus a router problem or a customer configuration problem. Further suppose that each diagnosis required different subsequent flow... How would a PAL represent this?

To appropriately answer this question, we need to start by putting anything we might use to represent a process in proper perspective.  No mapping tool or map can "fully represent" a process as anything we develop to represent the process is an abstraction (i.e. the map at some level represents the thing but is NOT the thing).  What we need to consider is what level of abstraction is relevant to any given process related activity or objective. 

One of the best examples of this principle is the use of mapping or GPS software for creating a travel route.  When our objective is to see the overall route and/or our relative position on the route, it often requires a higher level of abstraction (the big picture).  However, when we are trying to navigate at the street level, a much lower level of abstraction is required.  The original high level view is of no help at that point and visa-versa. 

When it comes to process, if our objective is to provide detailed documentation of a process for system development or other detail oriented reasons, a PAL is not the right level of abstraction.  However, when performing Optimization or Alignment analysis, it is exactly the right level of abstraction because it keeps us from the detail which does not help us in those activities.  In fact, it is often a high level of process detail that gets process improvement activities mired and "lost in the weeds."

When Balanced Scorecard first descended upon the business world in the late 80’s and early 90’s, it was a fresh and needed perspective that promised to help our organizations rise above the decidedly one-sided financial performance measures used up to that time.  Frankly, most organizations who have tried to implement a Balanced Scorecard have not reached the success they were looking for and the reasons are varied.  Balanced Scorecard has served a purpose to help us understand we need other ways to monitor and measure the outcomes which are linked to organizational success.  However, I’d like to talk about why it often fails and offer some suggestions for success in your scorecard efforts.

Most of the reasons Balanced Scorecard implementations fail are centered on the measures themselves.  One of the top reasons is picking the wrong measures; but includes unrealistic goals for the measures, lack of alignment with the real objectives, and the measures themselves being too difficult or expensive to effectively gather.  Next are issues such as conflicts with the legacy reward systems, measures losing relevancy over time, and failure to use the measurements to initiate corrective actions. Other reasons center on management issues such as poor project management, lack of senior management support, and lack of internal promotion.  Yes, implementing a Balanced Scorecard has some challenges.

I’d like to share with you another challenge I see with Balanced Scorecard.  While Balanced Scorecard has helped us set our sights on other ways to measure our organizations, when we look at what really matters, it is not truly a balance we should look for.  Peter Drucker prophetically told us years ago the customer is the foundation of every business; indeed, the customer is the business itself.  If we take care of the customer, we take care of the business and all stakeholders benefit.  We often give lip service to the customer.  In reality, the shareholders get primary deference in most publicly traded organizations, and even privately held organizations can be myopically focused on profits, ROI, ROC and the like. 

 The customer is our rallying point without question.  If all stakeholders agree the customer is the most important stakeholder in our organizations, there is no argument what our focus should be.  Even the stakeholder whom we call the customer agrees with this point of view.  It is inarguable.  Why do we take any other position?  Frankly, the truth is, we often do exactly that. 

While I wholly endorse the direction Balanced Scorecard has taken us from the narrowly focused financial measures, let’s not get hung up completely on the “balance” part.  The measures our organizations need to be keenly focused on are primarily related to our customers.  The companies who are leading their markets are using metrics correlating to what delivers successful customer outcomes, and that makes all the difference.

I can hear some muttering, “But satisfying the customer without a profit does no one any good.”  My response to that kind of thinking is to say if you can’t figure out how to deliver what your customers want and also make a reasonable profit, then based on Drucker’s definition of a business, you don’t have one.  All you have is an exercise in futility or perhaps a non-profit.  If profit is your motive, you need to rethink your approach or quit and end your suffering.

Creating a scorecard for your organization could be the right idea; here are some things to consider before you embark on that journey.  Hold off if your organization is in any situation that resembles a crisis, is struggling, or currently involved in any other large projects.  Projects of that magnitude are steep; if your organization is already on a hefty climb, it will most likely prove to be too much.

Consider looking at some of your organization’s most customer facing processes.  Perform a CEM Alignment analysis; you’ll get clarity on what customers really want while developing the KPI’s to measure your delivery.  This analysis is critical to discovering the right measures for your scorecard.

But don’t get hung up on balance.  A customer leaning scorecard is ideal.  Metrics related to your customers (by whatever name you call them), and their satisfaction, should be more prominent and weighted more heavily than any other measures you implement.  Nothing provides the opportunity for greater satisfaction for all stakeholders than raving customers.  That feels good and is good for everyone involved.  And remember, most scorecard efforts fail around the measures themselves.  Your measures truly need to gauge the delivery of outcomes the customers perceive successful to them.

I haven’t talked to many who have positive things to say about 2009, except that it is finally behind us.  On the other hand, everyone seems to be highly optimistic about 2010.  I think there is every reason to believe this year will be full of opportunities.  However, I think the best opportunities will come from a different set of behaviors and tactics than we have been using to survive the last two years.

2009 was a year of honing our survival tactics. For many of us in the process business, it meant using our skills to “lean” operations and milk every opportunity to cut costs.  For many organizations those efforts have resulted in significant cost reductions, and in the end, the very survival of our companies.  It wasn’t easy, but survival is good.  Many companies did not fare as well.  I haven’t seen any hard numbers yet, but I don’t recall seeing or hearing about so many business failures as I did in 2009.  I’m very sorry for them all.

For the survivors, I would like to suggest the behaviors which helped us survive are not necessarily the ones to help us take advantage of the opportunity before us, for two reasons.  First, while you have been focused inward on your internal processes and cost cutting, your customers have most likely changed.  While you have had your attentions on reducing the drag on the trigger-pull, your target customer may have moved outside the crosshairs.  Very few of us have come through the last two years without a different view of the world, altered perspectives, modified values, or even a different idea of what we want and what is really important to us.  We have changed in some way and so has our customer.  We need to check in and try to understand what may have changed.

The second reason we may need to take a different approach is the reality that cost cutting and leaning our processes sometimes has the undesirable effect of pushing work and risk back on the customer, who is paying us to take it on.  Have you felt this yourself recently?  I have on a number of fronts. 

One instance was when I recently helped a friend with a problem he was experiencing with his laptop.  He had purchased the laptop only a month before from a retail outlet.  The laptop came with instructions on how to obtain technical support from the manufacturer (a company based in Texas that normally sells direct to the customer).  Upon validating the serial number of the laptop for warranty and service, the manufacturer’s technical support informed us that since the laptop had been purchased through a retail channel, they could not support it and we needed to call the retailer for support.  Humph, ok… We called the retailer, who told us they didn’t have the resources to help, and to call the manufacturer or they could send out someone who charged by the hour. 

I know the PC business is a tough business these days, but this company (like many others) has taken it to an extreme, which only serves to push back on and alienate the customer.  And while the customer defections may not start right away, they will eventually and with certainty.  Customers will not continue to suffer.  Without correction, they will defect. 

Our opportunity in the coming year (or even decade) is to look at our organizations and processes anew with an eye to making sure they are in alignment with our customers.  We need to think about what has changed for them; what do we need to do differently to better serve them, or what new challenges do they face that we could help them with?  We also need to look to see if we have changed in a negative way that affects them in ways that frustrate them.  How can we make them successful?  The only true business success comes with making our customers successful from their point of view (not ours). 

From the Directors, Advisors and volunteers at IPAPI, we wish you the best of success in 2010 and your best year ever!

We don’t often think of governments as purveyors of great customer service. In fact, we are often dumbfounded when a government agency actually delivers what we would call “good customer service.”  When it happens we first think “Oh, this person must be new and doesn’t understand yet;” or “I’ve passed into an alternate reality and this really isn’t happening.”  The problem is when it comes to most governments, and in particular, western governments; they don’t have any clarity who the customer really is.  So when processes are designed and implemented, they often serve only the funding source such as the chief executive (i.e Mayor, Governor or PM, or President) or legislative body (i.e. legislatures, parliaments, Congress, etc.). 

However, I have seen an interesting trend in the Middle East of late.  Many of the eGovernement initiatives in a number of Middle Eastern countries are setting their sights on satisfying who is most often the real customer – the citizen.  One example is the Kingdom of Bahrain’s eGovernment Authority in their Capacity Building Project.  I was recently in Bahrain and had the privilege of leading a group from this project through the Certified Process Professional program.  I’ve never been more excited about the potential for what can be accomplished with CPP.  Bahrain is already a very nice place to live, and this group is committed to making it a superior experience for the citizens who rely on them for services.  I saw what they can do and the rest of the world should watch and take notice.

Most organizations are confronted with a daily ritual of problem solving.  From the C Level to the shop floor, we all experience our regular daily allowance of “ah crap” or something along that order.  It can be everything from minor nuisances to outright onslaughts. Solving problems every day comes with the territory and is often the reason we make those “big bucks.” Yes, a chuckle may be in order there.

Yet even when we are very good at organizational problem solving, it can lead us into a way of thinking which actually serves to do more harm than the intended good.  It affects our thinking, behaviors and decisions in subtle yet inherently destructive ways.  We need to become aware of this problem and its detrimental affect on our businesses; more accurately, its affect on our customers.  It’s called inside-out thinking.  Inside-out thinking in our personal lives is called myopia.  It’s when our view of the world has closed out any other view but our own; seeing only what serves us and our needs.  

Inside-out thinking is as natural for organizations as it is for human beings because our organizations are really extensions of us as humans.  How do we know when we are inside-out?  It’s actually not that hard and usually expressed in our talk.  Here is what inside-out thinking sounds like:

·    “Our customers do not appreciate what we do for them.”

·    “People are crazy if they don’t love our stuff.”

·    “Customers want the whole world and for free.”

·    “We have to make a living too.”

·    “This would be a great business if not for the customers.”

It should not be a shock to us that our organizations can become myopic.  However, just as it should be of concern for us as humans to break out of our personal myopia, we should also try to break free of our organizational myopia.  We call this outside-in thinking.

We need to keep in perspective why we are in business.  As the late Peter Drucker explained some time ago, “It is the customer who determines what a business is.”  Customers have problems too.  When we serve to solve a problem or problems for someone or society, it is only then we have a business and we have customers.  Outside of that, we have nothing.  If we are not solving problems for our customers, we are irrelevant.

Therefore, when we get so wrapped up in solving our own problems and lose sight of solving our customer’s problems, we become inside-out.  When solving business problems, the approach needs to be about the customer and not the organization. To achieve sustainable business success we need to keep sight of our customer’s problems and make their lives simpler, easier and more successful.  We need to understand their world and what they are ultimately trying to accomplish so you can see how to help them succeed.  That’s outside-in thinking. 

Take some time right now to reflect on what problems your customers have that you can or could solve.  Are you doing anything that creates more problems for your customers or is causing them frustration?  Then consider what your organization can do to solve those problems and ease that frustration.  Start solving more of your customer’s problems and you will solve more of your own than you can imagine.

A friend of mine, in curmudgeonly fashion, told me his story about a recent experience with an Internet provider gone amuck.  Almost everyone has their own tech support war stories.  I've heard a lot of them and have quite a few of my own to tell.  However, his experience has a surreal twist that begs sharing.

My friend's story starts when he called the tech support department at the Internet service provider to get some help in restoring his service.  After a number of false diagnoses, it was determined that a critical component to his particular service was turned off because according to their system, he was not paying for that service.  His protests and proof to the contrary, with recent paid invoices showing charges for the service, were no help.  My friend was not going to get his Internet connection back for a couple of weeks and that was that.

He had already investigated alternative providers because of similar shenanigans with this provider and decided to order the new service.  It got interesting when he tried to cancel his service with the old provider.  When he told the customer service representative he wanted to cancel his service, they told him he had to speak to the “Customer Loyalty Department.”

Yep, this company has a Customer Loyalty Department.  Doesn’t that sound impressive for a company to have such a department with such an auspicious name?  Can you speculate as to this department’s charter based on that moniker?  Now, let’s return to the story and see what they actually did for my friend.

The fellow from the Customer Loyalty Department (referred to as CLD from now on) asked what the problem was, what they could do to fix the problem, and still keep my friend’s business?  The CLD guy was very good at offering different ideas in the attempt to solve the problem and very persuasive as well.  Interestingly enough, he offered solutions the Tech Support department either couldn’t or didn’t offer.  Ultimately, the CLD guy was able to get the service up and running for my friend that very day, not the two weeks he was told earlier in the day by Tech Support.

This brings up all kinds of questions in my mind, as I’m sure it does for you.  For example, what does the CLD have that Tech Support doesn’t in order to solve customer issues and why?  Why does this company need a Tech Support Department if the CLD is much more effective at resolving customer problems?  Why wouldn’t they simply route all support calls to the CLD?  What company wants to frustrate their customers that they would force them to suffer an ineffective department before turning them over to the department who could really help them in the first place?  Better yet, what company would think after all the hassle, ineffectiveness and wasted time (when an easier and simpler solution was available), customers would actually stay for more of the same?

My friend, smart cookie he is, said this: “The loyalty department solved my immediate problem but the whole experience has left a bad taste in my mouth… Loyalty is not a department, it’s an attitude.  And if that attitude does not permeate all customer service experience, the department is a lost cause.”  My friend makes an excellent point!

This is the classic example of companies treating the symptoms rather than root causes.  They are adding additional overhead and non value added processes in an attempt to mitigate the upstream broken processes.  This obviously has additional ongoing operational costs to the company, which are likely justified by the success in saving a few customer relationships, if only temporarily.  I challenge this justification in that the resources could more effectively be used to solve the root causes of the problems, thereby eliminating the ongoing costs of continuing to mitigate the problems; and without risking the customer relationship in the first place. 

The company in this example is not alone in their approach.  Many organizations including banks, credit card issuers, insurance companies, cable and satellite providers and so many others use this approach.  These organizations may feel successful because they perceive they are saving customer relationships, and sometimes it would appear so.   From where I’m standing, it looks much the same as paramedics who run over someone; then patch them up and expect to send them happily on their way.  Right…  That’ll work…

Customer Loyalty is created when everything about an organization is focused on understanding what outcomes help their customers feel successful, then doing everything in their power to create those successful customer outcomes.  Any organization which treats customer loyalty as an afterthought is totally off target.  Consider what is really going on next time someone says to you: “I’m sorry, I can’t cancel your account; you need to speak to the Customer Loyalty Department” (or whatever they’ve called it).  The paramedics just ran over you…

I heard about a young couple who decided to open a produce stand on a vacant corner a few years ago and became wildly successful.  In the beginning it was just the two of them.  Every day they conversed with their customers about what was good, what wasn’t so good, how they used the produce, and from this developed a keen understanding of what their customers valued.  They noted these discussions in a notebook by the register and used this information daily when they bought the produce they would sell to their customers.  It was a keen strategy and their business grew quickly.  Soon it was more than they could handle by themselves and they hired an employee.  And then another, until someone suggested opening another stand on another corner in town.  This stand didn’t have the success of the first, but it was still profitable.  They continued to open more stands across the city and soon had an office, running all the stands by phone from the home office. 

By most standards a huge business success story, but the couple at one point noted the success of any one stand at no time since the expansion had ever been even close to the success of the original stand prior to expansion.  Why?  Most attribute this result to the lack of direct involvement by the owners and a logical and necessary loss for the good of the company.  I won’t argue there is some degree of effect with direct owner-customer involvement.  However, my analysis is that it has more to do with the natural learning mechanisms of feedback loops, and the fact that growth in our organizations and management systems result in significant signal loss with regard to customer feedback.  Generally speaking, the larger our organizations become, the greater the feedback signal loss and customer disconnect there is, resulting in varying levels of reduced customer satisfaction.  I also believe this is not necessarily the way it has to be.

Sustainable business excellence comes from restoring the customer feedback loops we squelch with the structures and systems created in order to effectively manage our organizations.   This is in contrast to the occasional efforts we make to “get in touch with our customers” through one-off surveys and voice of the customer (VOC) programs.  What we have to do is mend, or create, new feedback loops so they become continuous and ongoing; those feedback loops need to pass through all levels of the organization. 

Where does it start?  Obviously it starts with the people in the organization who touch the customer.  These could include sales staff, customer service reps, call center reps, service techs, even the company receptionist. Anyone who interacts with the customer on a regular basis needs to be trained on how to casually and unobtrusively gather feedback from the customer about value perceptions, preferences, applications, even suggestions for enhancement, improvement or other products or services. 

Customer complaints are another great source of feedback.  I’m amazed so few organizations capture and effectively use customer complaints.  I’ve never actually seen any hard data supporting the notion there are 10 unsatisfied non-complainers for every complaint a company receives.  However, I think we all can agree there is a vocal minority.  While we may not know exactly how many customers are suffering in relative silence, we know it is some factor.  We really need to pay attention to the complaints we receive, recognizing there is some number of customers feeling the same way and not speaking out. 

What can we do with the information once we get it?  There has never been a better time to answer this question.  Those people in the organization capturing customer feedback need to be enabled to easily transfer this information (feedback associated with specific products, services and processes) to a repository which is accessible and useable by everyone in the organization.  The best systems for that purpose today are wiki-like collaboration systems.  If your organization doesn’t have an enterprise wiki tool that can be used, there are plenty of free tools such as Wikidot (http://www.wikidot.com/), Zoho Wiki (http://wiki.zoho.com/) and Ning (www.ning.com) which is part social networking – part wiki.  Just getting the feedback in a useable form is half the battle.  The other half is getting people in the organization to be aware of it and use it for the benefit and delight of customers.  This is the full circle feedback loop.  It’s how humans and organizations learn, grow and adapt to our ever changing world.

Sustainability in process improvement and business excellence depends on restoring an effective customer feedback loop in our organizations.  I’m interested in your thoughts too, so please comment or email me (don.smith@ipapi.org).

On one hand, it’s hard to believe it was just a year ago IPAPI launched the community of practice for process professionals.  On the other hand, it has been a long and challenging year as we have struggled to execute on the vision.  What is the vision exactly?  It is to create a cohesive and credible global professional community and common body of knowledge for business process and performance professionals in order to elevate the level of professionalism in our industry, while more effectively facilitating the success of the organizations we serve.  It doesn’t sound like it should be that hard.  When we started, we were pretty sure we knew what we were doing.  We have had some big wins this year, such as the roll-out of the IPAPI Education and Certification Framework, the corresponding Certified Process Manager (CPM), Certified Process Director (CPD) and Certified Process Expert (CPE) programs.  We know because your response to these programs has been tremendous.  But as many of you know, we have made a mountain of mistakes and struggled to deliver on many of our other objectives and initiatives.  We have appreciated your patience and support as we’ve worked to fix the issues and find our way. 

One large area we know we missed the mark is the website.  We have been working for the last six months to determine what it should be in order to accomplish the vision.  We’ve asked for feedback from the community and we heard what you said.  On October 1^st, our one year anniversary, we hope to launch our new website which we feel will facilitate the achievement of the vision. 

However, we still need your help.  We have accumulated some great methods, knowledge, content, and tools, but these are just a foundation.  We have so much yet to gather to form a comprehensive body of knowledge.  The professionals in the community at large hold that knowledge, but we need to aggregate it into a formalized body of knowledge for the common good of our profession and to elevate our profession.  We need you to collaborate with your peers and contribute this knowledge to and integrate it into a common body of knowledge.  Please help us achieve this vision!  Please get ready to roll up your sleeves and work to build something that will benefit everyone.  I will provide specifics closer to the launch of the new website.

I should also tell you about some changes in the leadership of IPAPI in case you are not already aware.  One of our founding Directors, Terry Schurter, has taken a full-time position within a BPMS software company.  Terry felt this new position could represent a conflict of interest and has asked to resign as an IPAPI Director.  However, Terry made clear he was committed to building the IPAPI community and expressed an interest in continuing on in the role of an advisor.  Therefore, the board of Directors has accepted Terry’s resignation as Director and nominated him as the Chairman of the Board of Advisors to IPAPI.  I want to thank Terry on behalf of the Board of Directors for his hard work and prior contributions to the IPAPI community; we appreciate his willingness to continue to serve in the role of an advisor.  Best of luck, Terry, with your new responsibilities!

Additionally, I would like to announce the election of IPAPI member and Certified Coach Carlos Xavier as our newest Director.  Carlos is very keen to development of the IPAPI community in Europe, the Middle East, Africa and Asia.  Carlos, we thank you for your willingness to take on this responsibility.  You can reach Carlos at carlos.xavier@ipapi.org  if you would like to comment or help in this endeavor.

KasikornBank (KBank) of Bangkok, Thailand was the host to the largest CPP course ever held, with 30 delegates in attendance the first week of August.  It was my pleasure to be a guest at the amazing KasikornBank Learning Center and to lead this group through the foundations of Customer Expectation Management (CEM).  The facility is more like a resort than a training center.  The staff there made my stay extremely comfortable and the cafeteria was like dining at a 5-star restaurant three times a day.

I was also blessed with an extremely capable group of delegates.  If not for their ability to quickly grasp and apply the material in the case studies, it could have been a nightmare with so many.  Another surprising attribute about this group was the fact that they seemed to get along better than any group of people who work together regularly that I’ve ever witnessed.  Normally there are a few who don’t get along, but not in this group.  They all worked fabulously together no matter how many times I mixed up the teams.  Also in attendance were two fantastic facilitators to assist me and the First Vice President over the Process Development Department, Ms. Soopanit Rojanasaranrom, to keep things running smoothly.

One of the other bonuses of working with this group was the ability to visit with the attendees at meals and breaks about their Excellence program, which has been in place since 1993.  I was impressed with how mature their program is and what they have done with it.  It was obvious to me that “Excellence” is not just a slogan at KBank.  They mean it, do it and live it!

Congratulations and thanks to the amazing people in the Process Development Department at KBank!  You guys are AWESOME!